Can I edit out the middle of a video clip in iMovie?

Can I edit out the middle of a video clip in iMovie?

Yes.

What must I do?

Basically you have three options:
1) If the clip is in the "Event" window, simply select (i.e., set and adjust if necessary "in" and 'out" points) the segment you want and transfer it to your "Project" window and place it where you want it.
2) If the clip is already in the "Project" window, simply select (i.e., set and adjust if necessary "in" and 'out" points) the segment you want to keep...
a) and press the "Split" option in the edit menu (or the "Split Clip" option in the context menu) to divide the clip into three segments. Then select each of the segments you don't want and press the "Delete" key to remove them from the "Project" window.
b) or, even easier, simply press the "Trim to Selection" option in the "Edit" menu.
All of these work flows do not physically remove anything from the "Event" but merely perform a non-destructive edit of the project for the purpose of later output.

good luck..... You are supposed to be able to select and "reject" a clip in the middle and then move rejected clips to the trash. iMovie seems to have a lot of trouble with this is your clip event is long and your resources minimal. Im getting ready to get with applecare for the 6th time to deal with this as my mac pro w/8 gb ram should be able to handle that.